Russia, Indonesia to Avoid Dollar in Su-35 Sale

Indonesia says it will barter coffee, palm oil and other commodities for Russian fighter jets, calling US and European sanctions against Russia an opportunity to boost trade.

“This barter under the supervision of both governments hopefully will soon be realized through the exchange of 11 Sukhoi Su-35s and a number of Indonesian exports, starting from coffee and tea to palm oil and strategic defense products,” Indonesian Trade Minister Enggartiasto Lukita said on Monday, as quoted by Reuters.

Russian state-run corporation Rostec signed a memorandum of understanding for the deal with Indonesian state trading company PT Perusahaan Perdagangan Indonesia. Rostec says it is committed to implement the terms of a counter trade program.

At the same time, the Russian corporation reserves the option to choose which goods it receives in trade from Indonesia as well as the right to pick trade partners and producers for cooperation under the agreement, according to Rostec.

“The deal allows expanding supplies of Indonesian goods that are the most easily-suited for the Russian market. The range of products will be discussed by members of a specially created advisory group,” the company’s press release reads.

Indonesia already operates 16 Sukhoi jets, bought in 2003, when it was subject to a US and EU embargo on arms sales amid the alleged military's human rights abuses in East Timor in 1999.

The Su-35 is a long-range '4++ generation' super-maneuverable fighter jet. It is armed with an internal 30mm cannon and has 12 hard points with a combined capacity of 8,000kg, compatible with a wide range of unguided and guided missiles and bombs. Its maximum speed is 2,500 km/h, with a range of 3,400km, and a combat radius of around 1,600km.

Jakarta is trying to promote its palm oil products amid decreasing demand in Europe. Indonesia is the world’s number one producer of the commodity, which is widely used in cooking, cosmetics and biofuel.

Trade between Russia and Indonesia, the largest economy in Southeast Asia, has fallen in recent years, but Lukita said the wide-ranging US and EU financial and trade sanctions against Russia are an opportunity for Indonesia to revive trade through barter deals in other industries.

“This is an opportunity that should not be lost from our grasp,” said Trade Ministry spokesman Marolop Nainggolan, as quoted by AP.